As an entrepreneur, a big chunk of what goes through your mind while you work is money. Every move you make to improve your business always costs you, and you never want to be caught unprepared. While this is a common struggle all entrepreneurs must overcome, it doesn’t have to overwhelm you because there are ways to make it easier.
Why you should create revenue streams
Having multiple streams of income is important for any individual who wants financial security, but they’re especially crucial for entrepreneurs whose success can often depend on capital and financial stability.
The most obvious benefit of having several revenue streams is that you have a Plan B, C, and D to fall back on in case your business is going through a slow period or a major change. Additionally, taking charge of sourcing income in a variety of ways means that you get to learn other markets and methods. This is a unique advantage that can help you stay ahead of your competitors in the long run.
Of course, for most entrepreneurs, creating revenue streams is tantamount to creating their own peace of mind. Having a safety blanket may help you be more confident to pursue paths you would otherwise ignore, or take risks that would have been too much if not for your multiple streams of income.
How to go about producing multiple income streams
Thankfully, there are several options available for entrepreneurs looking for financial security these days. Read on to find out what types of revenue streams are ideal for you:
Passive Income: Finance writer Kimanzi Constable notes how passive income is essential for entrepreneurs who want the freedom to explore different facets of their business while still maintaining financial security. There are several ways you can generate passive income, which will only require some effort at the start. You can earn from ad revenue by running a blog, or receive royalties from books and training manuals. Another great option is to offer ad placements if you have property, or offer storage rentals for your customers.
Investments: There are better ways to go about handling the bulk of your savings than just sitting on it. For one thing, most experts will tell you to diversify your portfolio by investing in stocks. Since you are looking to add revenue streams but not actively trade, pick low-risk, long-term investments like real estate or gold. FXCM highlights gold’s lasting value in the face of international and economic turmoil as an excellent low-risk choice for anyone looking to diversify their portfolio in the safest way possible. In the same manner, real estate values tend to go up and is also a good investment depending on the company, property, and location.
Creative Funding: We talked about non-traditional funding in our article ‘10 Essential Pieces of Business Advice for African Entrepreneurs’ and how Africans with an entrepreneurial flair often have to be more creative when sourcing money. For instance, Inc. recommends selling assets or licensing, as well as franchising or bartering with other business owners. These will allow you to have a separate income stream outside of the funds you already have.
There is no right answer to how many streams of income you should ideally have, as it really depends on your own needs and your lifestyle. That being said, when you’ve reached a point where you’re not constantly trying to overcome financial hurdles, you can rest easier knowing you can truly focus on the things about your business that matter.
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